The Current Business Environment on the Ground in Hong Kong

Over-reliance on tax as an incentive 

Hong Kong’s taxes are still low (the profits tax is 16.5 percent); however, taxes are coming down in the Asian region anyway. Selling a low tax jurisdiction is not enough to make Hong Kong attractive. An example of this is the low individual income tax offered to attract foreign talent into nine mainland cities in the Greater Bay Area.

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Vietnam’s Competition Law and its Impact on Foreign Companies

Vietnam’s Law on Competition came into effect on July 1, 2019, replacing the 2004 version of the law. In June 2018, Vietnam passed the new regulation, which focuses on competition restraining agreements, market dominance, economic concentration, and unfair practices.

Scope of the law

The new law has expanded its scope and now includes both Vietnamese and foreign companies and individuals in case their actions have – or potentially have – a competition restriction impact on the domestic market. A competition restriction impact is an influence that will exclude, reduce, or hinder competition in the market.

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Greater Bay Area Releases Detailed Plan on IIT Incentives for Overseas Talents

Eligible overseas talents working in nine cities in the region can enjoy a preferential tax rate of 15 percent – in line with the Hong Kong IIT rate. China Briefing explains the policy introduced.

To support the smooth implementation of the Guangdong-Hong Kong-Macau Greater Bay Area (GBA) plan and attract overseas talents to work in this region, China has rolled out measures to grant subsidies to overseas high-end and critically-lacking talents (including Hong Kong, Macau, and Taiwanese residents or “HKMT residents”).

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Surprisingly Little Criticism on Import Substitution

Interview with Christian Tegethoff, Managing Director, CT Executive Search

How do the Russia sanctions affect your work concretely?

Executive Search is not directly affected by Western or Russian sanctions. However, we do feel the effects indirectly.

Particularly smaller European companies are uncertain about the risks of exposure to the Russian market. It certainly seems that companies tend to leave opportunities unused because they engage in other markets instead of in Russia.

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Russia: Everybody Should Return to Sensible Cooperation

An interview with Jens-Uwe Klemens, Managing Director, Quarzwerke GmbH

How does the Russian business go in times of sanctions and import substitution?

All in all, our sites are currently well utilized. We mainly sell to the glass industry and foundries. Interesting target industries are the construction materials sector and the plastics industry. In the last two years, demand has improved. We are even considering expanding our production capacity.

However, the market prices our raw materials are at a level that makes long-term asset preservation difficult. The prices would have to be significantly higher for necessary investments in products of high quality.

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Russia: Interesting Market Despite Challenges

An interview with Stephan Schulte, Managing Director of the Russian subsidiary of Symrise AG

How is Symrise‘s business in Russia affected by the sanctions?

Our products are not subject to any Western sanctions, but to the Russian on agricultural products, which incidentally also include salt.

We used to import our raw materials from Europe and the United States, but this is no longer possible. Today we buy globally or, if possible, locally. This is not easy, because many suppliers do not provide the quality we require or the processing levels needed.

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Foreign Currency Accounts by Resident and Non-Resident Persons in India

In India, regulations on foreign currency exchange are quite strict. Individuals and businesses transferring money outside India often run into issues with the tax and regulatory authorities. To avoid any legal implications, it is essential for individuals and businesses to be aware of the regulations while making any foreign currency transfer or remittances.

The Reserve Bank of India (RBI) is the regulator of foreign exchange dealings in India. It prohibits, restricts, and regulates the opening, holding and maintaining of foreign currency accounts, and the limits up to which a person resident in India can hold the amount in such accounts.

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Vietnam’s Visas and Work Permit Procedures

Vietnam’s visa and work permit procedures, can be confusing for first time visitors. Vietnam Briefing explains the steps and what foreigners should pay attention to when planning a long-term visit.

The number of foreign skilled workers coming to Vietnam has steadily increased in recent years, surging to over 80,000 at the end of 2018. Most foreign workers that come to Vietnam are employees of foreign contractors, working for, or establishing, foreign direct investment (FDI) projects, coming from over 100 countries. 

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Kenya’s construction and real estate sector

SOTM by africon

According to Deloitte’s construction trends report, Kenya has remained the leading country with the highest number of projects in East Africa for four consecutive years, with projects increasing by 78% from 23 projects in 2017 to 41 projects worth $38.2 billion in 2018. The major construction projects are in real estate, energy and power, and transport, sources also reveal that the Kenyan government is spending billions of dollars on transport projects as Kenya is expected to become the logistics hub of East Africa. 

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Minimum Wages in China 2019

Minimum wages in China continue to grow. Through the first six months of 2019, four regions have increased their minimum wages: Beijing, Chongqing, Shaanxi, and Shanghai.

Last year, 15 out of the 31 regions in mainland China increased their minimum wages, while 20 did so in 2017.

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Provident Fund Scheme for International Workers in India

Foreign workers taking up overseas assignments pay more attention to the tax regime of the country when determining costs, and often tend to overlook the social security laws of the country, which are equally important.

India requires every business entity employing more than 20 workers to register with the national social security system, and makes it mandatory for employees and employers to contribute towards retirement and insurance scheme.

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How to Terminate an Employee in Vietnam

Terminating an employee can be challenging for foreign investors in Vietnam. Vietnamese labour law is generally considered employee friendly and the termination process must be based on statutory grounds, subject to formal requirements and procedures.

The Vietnamese labor law applies to all employers working in Vietnam under labor contracts regardless of whether such employees are Vietnamese or foreign nationals.

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Human Resources and Payroll in China 2019-2020

A firm understanding of China’s laws and regulations related to human resources and payroll management is essential for foreign investors who want to establish or are already running foreign-invested entities in China, as well as for local managers and HR professionals who may need to explain complex points of China’s labour policies.

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“Companies are dependent on direct search”

An interview with Christian Tegethoff Managing Director, CT Executive Search

What kind of assignments do you usually work in East Europe?

In Poland, the Czech Republic, Hungary, Southeastern Europe and the Baltic we mainly work for clients from West and Central Europe, as well as the Nordics. These are either medium-sized companies or large corporations that have been active in the region for many years and often operate local production sites. There is some preponderance in the B2B sector, especially in capital goods. Our clients also include consumer goods manufacturers, retailers and health care or pharmaceutical companies.

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“High level of intercultural competence required”

Interview with Thomas Piontek

One of your responsibilities at Petrom was recruiting for the Romanian sites. What were the main challenges?

The biggest challenge was clearly the lack of qualified personnel in Romania. That is not really surprising, because 20 percent of the Romanian working population now work abroad. In today‘s European countries, you will find strong Romanian minorities everywhere – blue collars and academics alike. Consequently, the supply of qualified candidates is limited in Romania.

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“No Longer an Extended Workbench”

An interview with Adrian Stadnicki Regional Director Central Eastern Europe, German Eastern Business Association (OAOEV), Berlin 

How has the trade volume between Germany and Central Eastern Europe developed in recent years?

Germany’s exchange of goods with Central Eastern Europe has been developing very positively for years. The region has become a top partner of the German economy. 2018, Germany’s trade volume with the Visegrád Group and the Baltic States amounted to more than 300 billion euros. The Czech Republic, Hungary and Slovakia rank in front of much larger countries such as Turkey, Canada, Brazil and India in terms of their trade volume with Germany.

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Beijing to Raise Monthly Minimum Wage from July 1

On May 9, the Beijing Municipal Human Resources and Social Security Bureau announced plans to raise the city’s minimum wage from July 1, 2019.

The monthly minimum wage for full-time employees will be raised from RMB 2,120 (US$309) to RMB 2,200 (US$321). The hourly wage for part-time employees, however, will remain at RMB 24 (US$3.5) on normal working days and RMB 56 (US$8.2) on statutory holidays.

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Labor Outsourcing in Vietnam: 5 Key Reforms from Decree 29

Vietnam recently issued new updates on labor outsourcing regulations under Decree 29/2019/ND-CP (Decree 29). The new regulation came into effect on May 5 and details guidelines on Clause 3 of Article 54 of the Labor Code regarding outsourcing services, deposit payment and the list of permissible outsourced jobs.

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5 Big Changes to China’s VAT in 2019

Following the announcements made in the annual Work Report delivered at the Two Sessions, the Ministry of Finance, State Taxation Administration, and General Administration of Customs have jointly issued a series of new policies on value-added tax (VAT).

The new policies, which took effect on April 1, 2019, aim to enhance economic activity in certain sectors by lowering VAT rates and increasing VAT credits.

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Workplace Injury Compensation in India – What Businesses Need to Know

Injured workers and worker compensation are key liability issues for any business in India.

This is particularly the case for companies with large labor forces, such as information technology and business process outsourcing (IT-BPO) or industrial companies, but small businesses are also impacted by labor laws that mandate compensation for employees injured on the job.

What laws govern compensation for workplace injuries?

Compensation for workers in India varies depending on the size of the company.

If the business employees more than 20 employees, the Employees’ State Insurance Act, 1948applies. Under this act, employees and the company pay toward an insurance benefit in case of injury. When a workplace injury occurs, the injured employee is able to avail of both medical and financial support.

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Hiring in China: Labor Costs, Job Preferences, Talent Market

As China’s economy matures, it is also producing more high-skilled labor, pushing up overall wage growth. This was illustrated by an early 2019 report by supply chain procurement solutions firm GEP, which stated that median wages in certain Chinese cities now surpass those in parts of Eastern Europe.

The wage growth has been proven by other comparative data as well in recent years. In 2017, the China Economic Review stated that China’s average wage had trebled between 2005 and 2016 to reach a level higher than in emerging economies like Brazil, Argentina, and Mexico.

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Provident Fund Scheme for International Workers in India

Foreign workers taking up overseas assignments pay more attention to the tax regime of the country when determining costs, and often tend to overlook the social security laws of the country, which are equally important.

India requires every business entity employing more than 20 workers to register with the national social security system, and makes it mandatory for employees and employers to contribute towards retirement and insurance scheme.

Read the complete article here


Automotive Parts Imports in Sub-Saharan Africa

SOTM by africon

Based on our analysis of the available data on automotive parts imports in Sub-Saharan Africa, we found that South Africa, Nigeria, Angola, Kenya, and Ghana were the top five importers of filters, spark plugs and brake plugs into Sub-Saharan Africa in the year 2017. South Africa being the largest market, accounted for 47% of these automotive parts imports worth $355 million, while Ghana being the fifth largest market was worth $21 million.

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German Investment in ASEAN Part V: Thailand and Vietnam

ASEAN briefing is produced by Dezan Shira & Associates.

The ten member states of the Association of Southeast Asian Nations (ASEAN) have seen a steady inflow of German investment in recent years. Current trends are expected to continue in the coming years. We looked at German investment in Brunei and Cambodia in the first part of this five-part article, covered Indonesia and Laos in the second part, focused on Malaysia and Myanmar in the third part while looking at the Philippines and Singapore in the fourth part. We now focus on Thailand and Vietnam in this concluding part of the article.

Read the complete article here.



Expatriates in India: Visa, Work Culture, Socioeconomic and Payroll Considerations

India is the second most favoured destination for expatriates that want to work in the emerging markets. Over the past few years, India’s rapidly growing infrastructure, industry, and services sectors have opened to greater foreign investments and multinational corporations.

This development has led to numerous employment opportunities for foreign nationals working in skilled and specialized roles in the country. Accordingly, the sectors in India that attract the largest number of foreign professionals are administrative roles in construction and engineering, followed by telecommunications and IT, and financial services.

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